Clearstream, Deutsche Börse Group’s post-trade services provider, is set to acquire a majority stake in UBS’s fund distribution platform Fondcenter AG/UBS.
The companies have reached a joint agreement by which Clearstream acquires 51 percent of Fondcenter AG from UBS for £308 million (CHF 389 million), while UBS will retain a minority of 49 percent.
UBS is set to remain a shareholder in the future business combination.
The partnership will create a ‘leading’ fund servicing provider with significant benefits for UBS and Clearstream clients, according to UBS.
Clearstream suggested that the newly-combined company will become the centre of excellence for fund distribution services with Deutsche Börse Group and will ‘significantly enhance’ Clearstream’s existing fund desk business.
Stephan Leithner, member of the executive board of Deutsche Börse AG and chairperson of Clearstream, commented: “Our leading position in the fund servicing area will be critically strengthened by Fondcenter and the UBS partnership. It complements our product offering in the investment funds distribution space.”
Leithner continued: “Our distributor customers will benefit from extended global fund provider coverage, while asset manager clients will have direct access to UBS GWM premier distribution network as well as access to Clearstream distribution reach. We expect to generate significant synergies from combining our fund distribution businesses.”
Sergio Ermotti, CEO UBS Group AG, said: “We are delighted to reach this agreement with Clearstream, building on the successful relationship we have had with them and Deutsche Börse Group for many years. Through this transaction and our long-term cooperation arrangements, we can achieve greater scale and breadth of offering for our clients and create significant value for our shareholders.”
The transaction is expected to be completed in the H2 2020, and subsequent to the transaction, Clearstream will fully consolidate Fondcenter.
According to UBS, the newly-combined distribution services will have over $230 billion in assets under administration.
